The state-owned largest power transmission company, the Power Grid Corporation of India (PGCIL), launched its Infrastructure Investment Trust (InvIT), becoming the first public sector company to do so.
After IndiGrid and IRB InvIT fund, Power Grid InvIT (PGInvIT) will be the third publicly listed InvIT in the country and second in the power transmission sector.
PGInvIT has offered a price band of Rs 99-100 per unit for the public issue. The issue will open on 29 April 2021 and close on 3 May 2021. The InvIT will raise Rs 4,993.5 crore as fresh issuance and PGCIL is also providing an offer for sale of Rs 2,742 crore of the existing units. PGCIL has offered five initial portfolio assets at an enterprise value of Rs 10,384 crore for the proposed PGInvIT.
The net proceeds from the offer will be utilised towards providing loans to the initial portfolio assets for repayment or pre-payment of debt, including any accrued interest availed by the initial portfolio assets; and for general purposes.
PGCIL has 18 projects with Rs 22,500 crore investment which are under construction. The government has allowed PGCIL to monetise its other TBCB subsidiaries through the InvIT route, which are under construction or will be acquired by it in future.
PGCIL acquires power transmission projects through two routes – nomination under which the Centre or state government allots projects or through competitive bidding (TBCB) route.
The current TBCB portfolio of PGCIL has Rs 5,000 crore worth of operational assets and seven under construction projects at an estimated cost of Rs 12,200 crore.
These include four projects which are for renewable energy linking. These can be considered for transfer to the InvIT. PGCIL recently won five TBCB projects.
PGCIL will also be the project manager of the InvIT and continue to provide operations and management services to the initial portfolio assets.
IDBI Trusteeship Services is the Trustee and POWERGRID Unchahar Transmission is the Investment Manager of the InvIT. The lead managers to the offer are ICICI Securities, Axis Capital, Edelweiss Financial Services and HSBC Securities and Capital Markets (India).